Slide 1: 2015 Full-Year Results
February 18th, 2016 2015 FULL-YEAR RESULTS
Slide 2: Disclaimer
Disclaimer NOT FOR RELEASE, PRESENTATION, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, SOUTH AFRICA OR ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION IMPORTANT: YOU MUST READ THE
Slide 3: Disclaimer (continued)
Disclaimer (continued) Unless expressly stated otherwise, no statement in this presentation (including any statement of estimated synergies) is intended as a profit forecast or estimate for any period and no statement in this presentation should be interpreted to mean that cash flow from operations,
Slide 4: Disclaimer (continued)
Disclaimer (continued) Investors should be aware that Fnac may purchase or arrange to purchase Darty Shares otherwise than under any takeover offer or scheme of arrangement related to the Proposed Acquisition, such as in open market or privately negotiated purchases. This presentation does not const
Slide 5: Fnac well positioned for new challenges
Fnac well positioned for new challenges Continued improvement on all performance indicators in 2015 reflecting the successful execution of Fnac 2015 strategic plan Market leadership strengthened Fnac 2015 financial objectives all met Group revenues stabilized – sales recovery in France Pro
Slide 6: Financial review
February 18th, 2016 2015 FULL-YEAR RESULTS Financial review
Slide 7: Key financial highlights
Key financial highlights Group sales stable for the full year 2015 (1) Continued sales growth in France Current operating income up 10.2% to €85m Strong increase in net income: +16.7% to €48m Ongoing improvement in free cash flow generation: €85m (+17% vs 2014) Strong financial position
Slide 8: Good sales performance in the 4th quarter driven by France
Good sales performance in the 4th quarter driven by France Group sales evolution 4th quarter 2015 sales evolution Iberian Other FY 2014 9M 2015 Q4 2015 Group France Peninsula Brazil countries 0.2% 0.0% X%: Vs n-1 at comp. scope of consolidation -0.4% and constant FX Group sales up 0.2% in the 4th
Slide 9: Confirmation of sales turnaround
Confirmation of sales turnaround Group sales evolution Group sales evolution FY 2014 H1 2015 H2 2015 FY 2015 0,0% -0,2% -2,1% -0.2% -3,1% 2012 2013 2014 2015 X%: vs N-1 at cst FX and comparable scope of consolidation Stabilization of Group sales for the 2nd consecutive year Sluggish consumption
Slide 10: Current operating income up 10.2% to €85m
Current operating income up 10.2% to €85m Full-year sales stable at comparable scope of €m 2014 2015 % CHANGE consolidation and constant FX REVENUES 3,895 3,876 -0.5% Increase of 20 bp in gross margin rate due to Good management of promotions during the Christmas Gross Margin 1,144 1,146 % Rev
Slide 11: France continuing to grow sales and profit
France continuing to grow sales and profit €m 2014 2015 % Change 2015 sales evolution Revenues 2 772 2 784 0.4% Life-for-like 0.7% FY 2014 H1 2015 H2 2015 FY 2015 0,9% Current operating 0,4% 0,4% income 47.5 53.2 12.0% -0,3% Operating margin 1.7% 1.9% X%: vs n-1 at comparable scope of consolidation
Slide 12: Iberian Peninsula improving profitability in competitive markets
Iberian Peninsula improving profitability in competitive markets €m 2014 2015 % Change H1 2015 sales evolution Revenues 659 657 -0.3% FY 2014 H1 2015 H2 2015 FY 2015 0.7% Life-for-like -3.0% Current operating 0.1% income 23.6 24.1 2.1% Operating margin 3.6% 3.7% -0.3% -0.7% X%: vs n-1 at comparable
Slide 13: Brazil resisting well despite strong headwinds
Brazil resisting well despite strong headwinds €m 2014 2015 % Change H1 2015 sales evolution Revenues 175 137 -21.8% FY 2014 H1 2015 H2 2015 FY 2015 Change at constant rate -7.5% Current operating -3.4% income -0.9 -0.5 44.4% -7.7% -7.3% -7.5% Operating margin -0.5% -0.4% X%: vs n-1 at comparable sc
Slide 14: Belgium and Switzerland: improved sales performance and profitability
Belgium and Switzerland: improved sales performance and profitability €m 2014 2015 % Change H1 2015 sales evolution Revenues 290 298 3.0% FY 2014 H1 2015 H2 2015 FY 2015 Change at constant rate -1.8% -1.1% -1.8% Current operating -3.1% -2.8% income 6.9 8.2 18.8% Operating margin 2.4% 2.8% X%: vs n-1
Slide 15: Strong increase in net income
Strong increase in net income % €m 2014 2015 Change Non-current operating items, in line Current operating income 77 85 10.2% with previous year Non-current operating -9 -9 -2.2% Including fees relating to Darty income and expenses acquisition project Operating income 68 76 11.3% Stable financ
Slide 16: Higher cash generation
Higher cash generation Higher non-current cash items €m 2014 2015 Var. Cash flow from operations before Good management of working tax, dividends and interest 122 115 -8 capital Inventories down -1.7% Change in inventories 4 -3 -7 Strong actions on receivables and Change in other working cap
Slide 17: Strong balance sheet
Strong balance sheet €m 31/12/2013 31/12/2014 31/12/2015 Shareholders’equity 550 595 564 o/w equity 490 535 564 o/w TSSDI 60 60 - Net Cash 461 535 544 Redemption of the TSSDI on December 30th, 2015 For an amount of €68m, based on a 5% coupon Net cash position of €544m at end 2015 High level
Slide 18: Strategic review
February 18th, 2016 2015 FULL-YEAR RESULTS Strategic review
Slide 19: Best-in-class omnichannel player
Best-in-class omnichannel player Omnichannel sales in France Accelerated sales momentum at Fnac.com (% online orders) 46% Omnichannel sales reaching 46% of orders 35% 29% 22% Continued strong growth of marketplace 12% M-commerce gaining momentum (c. 40% of online traffic) 2011 2012 2013 2014
Slide 20: Success of the offer diversification strategy
Success of the offer diversification strategy Share of new categories (% of Group sales) Continued ramp-up of new product categories 15% 11% Accounting for 15% of Group sales in 2015 4% 6% Further deployment of stationary sections in France Fnac.com product range expanded to Sport category F
Slide 21: Expansion strategy focused on new formats and franchise
Expansion strategy focused on new formats and franchise New format store network Accelerated expansion in 2015 46 15 openings in 2015 (vs 11 in 2014) 34 2 23 23 46 new format stores end of 2015 16 15 10 5 2 Proximity format expanding rapidly in France and internationally 19 21 14 18 10 An
Slide 22: Expertise in ticketing offering strong potential
Expertise in ticketing offering strong potential Leadership strengthened in the distribution business (BtoC) Successful development in 2015 despite terrorist attacks Sustained growth in internet sales, driven by both Fnac.com and partners Good performance in Arts & Museum and Contemporary mu
Slide 23: Conclusion
February 18th, 2016 2015 FULL-YEAR RESULTS Conclusion
Slide 24: Conclusion and outlook
Conclusion and outlook 2015 results confirm the Group’s successful transformation as part of the Fnac 2015 strategic plan Consumer environment still uncertain in 2016 Fnac well positioned to continue its market share gains through building on its omnichannel expertise The Group will focus pa
Slide 25: Recommended offer for Darty plc
February 18th, 2016 2015 FULL-YEAR RESULTS Recommended offer for Darty plc
Slide 26: Acquisition highlights
Acquisition highlights A highly logical Creating a market leader in the French electronics, editorial & home appliances retail market combination Enhanced European footprint Attractive synergy Run-rate pre-tax synergy impact of at least €85m per annum1 potential Limited implementation costs
Slide 27: A highly logical combination
A highly logical combination 1 Creating a market leader A market leader in the French electronics, editorial & home appliances retail market 2 A combination of two iconic French brands which will benefit customers Combination of two highly recognised and well-respected brands with strong customer
Slide 28: Creating a French leader in its key markets
Creating a French leader in its key markets #1 electronic and editorial goods retailer in France Top 10 consumer electronics retailers in Europe1 (FY2014 revenues, €bn) (FY2014 revenues, €bn) 5.6 21.0 12.4 11.8 1 2.8 2.8 2.8 8.8 1.9 1.9 1.9 7.4 1.8 4.7 2 1.0 3.9 3.5 3.5 0.6 0.5 Source LSA Magazine;
Slide 29: Combination of two iconic French brands
Combination of two iconic French brands “L’agitateur culturel” “Le contrat de confiance” Enjoyable customer experience Strong commitment to customer service Independence and expertise of sales Unrivalled aftersales capabilities force Top-of-mind brand awareness in home Top-of-mind for in
Slide 30: More diversified product offering
More diversified product offering A more resilient and diversified offering with multiple growth levers 1, 2 Product categories offering complementary growth and margin profiles Services Services & Accessories Brown and grey products growth 5% Accessories 13% 9% underpinned by short innovation E
Slide 31: An enhanced omni-channel offering
An enhanced omni-channel offering Attractive online presence1 Innovative omni-channel services Amazon 17.5 Cdiscount 10.7 Fnac 10.7 eBay 7.9 Carrefour 7.6 PriceMinister 7.5 Voyages-Sncf.com 6.9 La Redoute 6.8 Both groups offer state-of-the-art omni-channel capabilities Vente-privée 6.0 Click&Mag
Slide 32: Improved scale and reach
Improved scale and reach Diversified formats Complementary networks in France1,2 Iberia Destination Cities > 80,000 people 2 High street or prime 22 25 3 shopping centres 3 2 Periphery Retail parks outside 2 2 larger cities 2 2 Benelux 2 Proximity 3 Cities < 80,000 2 2 75 people 2 Downtown
Slide 33: Enhanced financial scale and cash flow generation
Enhanced financial scale and cash flow generation Key financials (as of 31/12/2014 for Fnac and 30/04/2015 for Darty) €m Sales 3,895 3,512 7,407 Approximately doubling sales and EBITDA EBITDA 147 119 266 c. €270m of combined EBITDA with better scale and resilience on the back of a EBIT1 77 68 14
Slide 34: Significant synergy potential
Significant synergy potential Driving further value through synergies… Purchasing synergies in Optimisation of Quantified Financial common product warehousing & transport Benefit Statement categories (brown, grey, prepared by Integration of certain HQ management and small domestic and suppor
Slide 35: Solid capital structure
Solid capital structure Key financing terms Comments Credit facilities successfully syndicated in December with a pool of 16 European Bridge banks RCF Loan Tailored financing package covering Quantum €465m €400m partial cash alternative, potential refinancing of existing financial liabilities of
Slide 36: Transaction overview
Transaction overview Recommended offer to acquire Darty 1 Fnac share for every 37 Darty shares Partial cash alternative up to a maximum aggregate amount of approximately £67 million(1) to be made available Deal terms Based on the closing price of €55.6 per Fnac share on 19 November 2015(2):
Slide 37: Appendices
February 18th, 2016 2015 FULL-YEAR RESULTS Appendices
Slide 38: Q4 and FY revenue
Q4 and FY revenue Change vs Q4 2014 Change vs 2014 at constant at constant Q4 2015 FX and Like for like 2015 FX and Like for like €m Reported comparable at constant Reported comparable at constant scope of FX scope of FX consolidation consolidation France 1 023 1.1% 1.1% 1.0% 2 784 0.4% 0.4% 0.7% Ib
Slide 39: H1 and H2 revenue
H1 and H2 revenue Change vs H1 2014 Change vs H2 2014 at constant at constant H1 2015 FX and Like for like H2 2015 FX and Like for like €m Reported comparable at constant Reported comparable at constant FX scope of FX scope of consolidation consolidation France 1 148 -0.3% -0.3% 0.4% 1 636 0.9% 0.9%
Slide 40: 2015 sales by category
2015 sales by category €m 2015 % Change Technical products 2,239 2.5% Editorial products 1,428 -5.6% Services 209 5.7% Total sales 3,876 -0.5% 2015 FULL-YEAR RESULTS 40 February 18th, 2016
Slide 41: Non current operating income and expenses
Non current operating income and expenses €m 2014 2015 Non current operating expenses -13 -11 Expenses about the acquisition of Darty 0 -6 Restructuring costs -13 -3 Others 0 -2 Non current operating income 4 1 Litigation and disputes 4 1 Total -9 -9 2015 FULL-YEAR RESULTS 41 February 18th, 2016
Slide 42: Financial charges
Financial charges €m 2014 2015 Cost of net indebtedness 0 -1 Other financial charges (net)(1) -12 -13 Financial charges (net) -12 -13 (1) Includes expense on the cost of free consumer credit. the impact of discounting assets and liabilities and fees related to the revolving credit facility 2015 FULL
Slide 43: Net current income
Net current income €m 2014 2015 Income before tax 56 63 Non-current operating expenses and revenues -9 -9 Current income before tax 65 72 Total tax charge -15 -14 Tax on non-current items 2 1 Current tax (expense) / Income -17 -15 Net current income 50 57 2015 FULL-YEAR RESULTS 43 February 18th, 201
Slide 44: Balance sheet
Balance sheet FY FY FY FY ASSETS in €m EQUITY AND LIABILITIES in €m 2014 2015 2014 2015 Goodwill 332 332 Share capital 17 17 Reserves related to equity 495 497 Intangible assets 68 71 Conversion reserves -2 -14 Tangible assets 163 157 Other reserves 80 57 Non-current financial assets 7 8 Equity Grou
Slide 45: Cash flow statement
Cash flow statement €m FY 2014 FY 2015 Net income from continuing operations 41 48 Net additions to depreciation. amortization and provisions 57 44 Financial interest income and expense 6 6 Net tax charge payable 18 17 Cash flow from operations before tax. dividends and interest 122 115 Change in wo
Slide 46: Working capital
Working capital As of As of €m December 31, 2014 December 31, 2015 Inventories 469 467 Accounts receivable 115 87 Accounts payable -713 -761 Other operational working capital including Accounts -306 -286 receivable and payable related to CAPEX Operational Working capital -435 -493 Financial account
Slide 47: EBITDA
EBITDA 2014 2015 Current operating income 77 85 Net depreciation and amortization charges -70 -61 EBITDA 147 146 Rents -129 -133 EBITDAR 277 278 2015 FULL-YEAR RESULTS 47 February 18th, 2016
Slide 48: Net cash position
Net cash position €m Free cash flow: €85m 44 115 -16 -58 -6 2 -66 -6 535 544 Net cash Cash Flow Change in Corporate Net capex Net financial Increase / Net interest FX effect Net cash position at before tax, working capital income tax investments Decrease in paid and position at December 31, dividend
Slide 49: Shareholders’ funds
Shareholders’ funds 700,0 €m 650,0 33 600,0 2 2 0 550,0 -68 0 500,0 595 564 450,0 400,0 Shareholder's Increase in capital Total TSSDI repayment Valuation of Dividends paid Others Shareholder's equity as of comprehensive share-based equity as of December 31, income payments December 31, 2014 2015 201
Slide 50: Exchange rates
Exchange rates vs EUR 2014 2015 BRL (Brazil) 3.12 3.69 CHF (Switzerland) 1.21 1.07 NB : average rates 2015 FULL-YEAR RESULTS 50 February 18th, 2016
Slide 51: Store network
Store network December 31, 2014 December 31, 2015 Owned Franchised Total Owned Franchised Total France * 85 27 112 86 38 124 Iberian Peninsula 47 0 47 48 1 49 Brazil 12 0 12 12 0 12 Other countries 13 0 13 14 0 14 Group 157 27 184 160 39 199 * Included 1 store in Morocco,1 store in Qatar and 1 store